How national pundits view Detroit's bankruptcy

Jul. 19, 2013

Part of the Detroit skyline is seen behind a housing project under construction in Detroit, Wednesday, April 13, 2011. Some experts say Detroit's population will decline more over the next decade before possibly climbing back up. Another 100,000 to 200,000 people could leave the financially troubled city, which lost a quarter of its population between 2000 and 2010. (AP Photo/Carlos Osorio) / Carlos Osorio/AP Photo

Written by

Detroit Free Press Business Writer

Here’s a sampling of commentary from national media, pundits and experts.

The Atlantic’s James Fallows noted that “Detroit's municipal bankruptcy filing came on the same day that the Dow Jones average hit an all-time high.” He said one of his only experiences with Detroit was watching Chrysler’s 2011 Super Bowl commercial launching the “Imported From Detroit” campaign and featuring rapper Eminem.

Associated Press writer Corey Williams, a Detroit native, recalled the 1967 riots as a turning point in the city's history and said the moment “would define Detroit over the next 46 years.” He said he was “embarrassed” by the city’s decline and added: “I didn't live through Detroit's ‘Golden Years.’ By the time I was born, the Arsenal of Democracy, Motor City and Motown had grown tired. My hometown aged very badly, and at 4:06 p.m. Thursday, it became the largest city in U.S. history to go belly-up. The Detroiter in me wonders why it took so long.”

Doron Levin in Forbes wrote that Michigan Gov. Rick Snyder “struggled heroically for two years to break the impasse” in Detroit before finally approving the bankruptcy filing as a last resort. Levin wrote: “Detroit's bankruptcy is a profound failure for a place where once beat the heart of this country, where the economic engine of the American Century roared to life, where a banner of African-American empowerment flew, where the middle class came to know itself, and where timeless aspects of the American Dream were born. No one should be shocked that Kevyn Orr, Detroit's emergency financial manager, finally took the step of petitioning the federal court for Chapter 9 protection from creditors. This outcome has been at least two years in the making and, by some reckoning, much longer than that. This is the bottom many of us have been gloomily waiting for.”

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The Wall Street Journal, in an editorial, said the bankruptcy would “merely cause more suffering for the city's residents.” The Journal, which has been critical of Detroit unions, added: “Meanwhile, unions aim to protect their pensions from any impairment—a necessity if the bankruptcy is to be successful—by arguing that their promised benefits are protected by the state constitution, never mind that the federal bankruptcy code trumps state law. It also authorizes the abrogation of contracts. As the lawyers battle in court, the streets of Detroit will continue to suffer from deteriorating services, blight and crime. This is the real tragedy of Motown's fiscal collapse.”

Politico reporter Ben White wrote: “There is no clear line of partisan blame to draw through the Detroit disaster. The city certainly suffered under decades of bad management by Democrats, and attacking urban one-party rule is fair game. But the city’s financial collapse followed a mass population exodus that left the city with huge costs it simply lacked the tax base to handle. Efforts to reach deals with various creditors — from bondholders to retirees — failed, leaving a bankruptcy filing to restructure crushing debt as the only option.”

Douglas McIntyre of 24/7 Wall St. wrote in a USA Today op-ed that Detroit deserved bankruptcy because of what he described as irresponsible unions. “Detroit earned its bankruptcy the easy way — through greed, the desire for political power and poor planning.”

Grist writer Susie Cagle said the city “still has thousands of strong remaining residents who love their city deeply” and said the bankruptcy comes amid other storylines on the city’s fate: “For as much is made today about Detroit’s bankruptcy, much has been made of its comeback over the last few years — a comeback that hinges on embracing a ‘managed decline.’ For Detroit, giving up a fair bit of the urban for the jungle stands to allow the city to settle into its new, post-industrial, smaller self.”